Oil Palm Can Turn Ghana’s Economy Around  

Oil palm

Accra, Ghana, May 24, 2019//-Ghana as a country is blessed with many agricultural resources that if properly managed could lead to rapid economic development and progress. One of such resource is the oil palm.

Oil palm cultivation has been an old business in the West African country and still remains a good investment for those who are interested in agriculture and others who are looking to diversify their portfolios by including agricultural investments

Market sources say Ghana’s first international commercial trade in oil palm took place in 1820. Starting from the wild palm harvesting, oil palm evolved into an agricultural crop and plantations were established by 1850.

This led to palm oil becoming the principal export from the then Gold Coast. By the 1880s, palm oil accounted for 75% of the country’s export revenue.

Interestingly, Malaysia which is currently dominating the world palm oil market started the establishment of oil palm plantations with planting materials from Ghana.

Ghana currently has a total of 305,758ha of oil palm. More than 80% of this is cultivated by private small-scale farmers. It is estimated that 243,852tons of palm oil is being produced.

Ghana currently has an unmet demand of 35,000tons of palm oil. The estimated unmet demand in the ECOWAS sub-region is 850,000tonnes.

This presents an opportunity for Ghana to scale-up production of the cash crop to satisfy local and regional demand for much-needed foreign exchange.
According to experts for an effective transformation of the sector, the role of financial institutions cannot be underestimated, as they are required to collaborate with the Ministry of Food and Agriculture (MoFA) and other stakeholders to provide technical expertise to their clients to overcome challenges such as inadequate technologies and skills, access to capital and other inputs.

“Equally, Farm Services Companies are also required to support farm level activities due to aging farmer population while the youth, with funding support from the rural banks, are required to venture into the agriculture sector to reduce the burden of unemployment”, they add.

Making the business attractive will not only transform rural lives but also help improve the foreign exchange situation of the country.

The total area suitable for oil palm cultivation in Ghana is one million hectares. The suitable areas are in the: Western, Western North, Central, Ashanti, Volta, Oti, Bono and Ahafo regions.

In spite of inherent challenges, growing oil palms is a good investment. The oil palm has the highest yield of any oil plant – it is also the only crop that yields two different oils that are useful to industry: palm oil and palm kernel oil.

Oil palms occupy the smallest proportion of all the land that is used for oil and fat production while at the same time accounting for the largest proportion of worldwide oil production – 32 per cent.

Sunflowers, coconut and soybeans all have a yield per hectare that is on average just one-third that of palm oil.

To Alan Townsend, Dean of the Nicholas School of the Environment at Duke University, “Palm is one of the most productive crops on the planet, with the ability to grow in a remarkable range of places.

Couple that with large profit margins, an incredible diversity of uses for palm oil and a lack of economically competitive substitutes, and you can quickly see why the industry has grown so rapidly.”

Demands for oil palm fruits and other products of oil palm plantations are large. Although West Africa lies in the centre of the world’s oil palm belt, it produces less than 5 percent of the palm oil consumed worldwide.

Malaysia and Indonesia have become the dominant powers in palm oil production and presently supply more than 70 percent of the palm oil consumed worldwide.

Sources at the Ministry of Food and Agriculture show that Ghana has about 305,758 hactares of oil palm. More than 80% of this is cultivated by private small-scale farmers. It is estimated that 243,852 tonnes of palm oil is being produced. So, the industry’s potential is too huge to be tapped.

By Oppong Baah, African Eye Report

 

 

 

 

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